Correlation Between Amper SA and Distribuidora Internacional

Can any of the company-specific risk be diversified away by investing in both Amper SA and Distribuidora Internacional at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Amper SA and Distribuidora Internacional into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Amper SA and Distribuidora Internacional de, you can compare the effects of market volatilities on Amper SA and Distribuidora Internacional and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Amper SA with a short position of Distribuidora Internacional. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amper SA and Distribuidora Internacional.

Diversification Opportunities for Amper SA and Distribuidora Internacional

0.68

Correlation Coefficient

Amper SA  Distribuidora Internacional

Poor diversification

The 3 months correlation between Amper and Distribuidora is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Amper SA and Distribuidora Internacional de in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Distribuidora Internacional and Amper SA is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Amper SA are associated (or correlated) with Distribuidora Internacional. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Distribuidora Internacional has no effect on the direction of Amper SA i.e., Amper SA and Distribuidora Internacional go up and down completely randomly.

Pair Corralation between Amper SA and Distribuidora Internacional

Assuming the 90 days trading horizon Amper SA is expected to generate 1.53 times more return on investment than Distribuidora Internacional. However, Amper SA is 1.53 times more volatile than Distribuidora Internacional de. It trades about 0.12 of its potential returns per unit of risk. Distribuidora Internacional de is currently generating about 0.17 per unit of risk. If you would invest  11.00  in Amper SA on October 27, 2024 and sell it today you would earn a total of  1.00  from holding Amper SA or generate 9.09% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Amper SA  vs.  Distribuidora Internacional de

Amper SA

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Amper SA are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, Amper SA is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Distribuidora Internacional

Risk-Adjusted Performance

20 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Distribuidora Internacional de are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, Distribuidora Internacional exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Amper SA and Distribuidora Internacional

The main advantage of trading using opposite Amper SA and Distribuidora Internacional positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amper SA position performs unexpectedly, Distribuidora Internacional can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Distribuidora Internacional will offset losses from the drop in Distribuidora Internacional's long position.

The idea behind Amper SA and Distribuidora Internacional de pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Bonds Directory module to find actively traded corporate debentures issued by US companies.